Many gyms offer a mixed two-part tariff pricing scheme. One can join the gym and then have
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The gym likely faces two types of consumers lowdemand customers and highdemand customers The dual pricing scheme is designed to raise more producer surplus for the gym than does the conventional singlepricing strategy The dual strategy may be better than charging a single price in which case highdemand customers end up with a lot of surplus that could have been profits and better than charging a twopart tariff alone in which case the producer would lose its lowdemand customers Price unit Pml Pa B a Lowdemand customer ...View the full answer
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Related Book For
Microeconomics
ISBN: 9781464146978
1st Edition
Authors: Austan Goolsbee, Steven Levitt, Chad Syverson
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